Madigan sues AmerenIP, AmerenCIPS over all-electric discounts

Wednesday

May 30, 2007 at 12:01 AMMay 30, 2007 at 10:18 AM

Illinois Attorney General Lisa Madigan filed suitTuesday against two Illinois electric companies, saying the companies continued offers of all-electric discount programs to consumers even after the companies were planning to eliminate the program.

Illinois Attorney General Lisa Madigan filed suit Tuesday against two Illinois electric companies, saying the companies continued offers of all-electric discount programs to consumers even after the companies were planning to eliminate the program.

The lawsuit, filed in Jackson County, names AmerenIP and AmerenCIPS, alleging violations of the Consumer Fraud and Deceptive Business Practices Act.

The suit was announced Wednesday in a news release from Madigan's office.

Madigan began the investigation in March based on complaints from consumers in 31 counties who said they were enticed into signing up for the discount program only to find out that the companies planned to eliminate it on Jan. 2 – the same time the companies raised overall electric rates. After January, all-electric customers experienced huge increases in monthly electricity bills, from 55 percent to 350 percent, the release said.

In December 2006, less than a month before the end of the discount program, these two companies were still offering the plan, signing up about 444 in that month alone, Madigan's office said.

In an e-mail response, Ameren spokesman Leigh Morris said Wednesday afternoon the utilities had not yet been formally served with the lawsuit.

"We understand the nature of the allegations ... and take them very seriously," Morris said. "The Ameren Illinois utilities expect to prevail in this lawsuit because the companies have not improperly promoted all-electric rates.

"The rates that are in effect are lawful and have been approved by the Illinois Commerce Commission. The power prices associated with these rates were not known until the September 2006 auction, and the delivery service components of the rates were not known until November 2006.

"Ameren Illinois utilities' rates now are approximately at the national average," Morris wrote. "The change in rates comes after a 10-year rate freeze and a legislatively mandated rate reduction."